Madison's Lumber Reporter: Lumber prices flat on significant production curtailments

Photo By Madison's Lumber Reporter

As October drew to a close, significant production curtailments at several large British Columbia lumber producers helped keep softwood lumber prices flat, reports Keta Kosman from Madison's Lumber Reporter.

Most of these operators cited high log costs vs lower lumber prices as the reason for taking this downtime.

Meanwhile, it seemed that Weyerhaeuser and the union came to an agreement, so the recent lack of Hemlock and Douglas fir lumber items is expected to be rectified over the coming month. These supply constraints, combined with quite low inventories in the field, provided lumber sellers with the ability to eschew counter-offers and stick with their prescribed price lists — for another week, at least.

Staying even from the previous week, in the week ending October 28, 2022, the price of benchmark softwood lumber item Western Spruce-Pine-Fir 2×4 #2&Btr KD (RL) was again US$480 mfbm, said weekly forest products industry price guide newsletter Madison’s Lumber Reporter.

layers all over noted the importance of recent curtailment announcements from two large BC producers, with that development nudging many heretofore reticent buyers off the fence.

Sales of most commodities continued to strengthen in a low-key fashion; the Weyerhaeuser strike continued to throw the Hem/Fir market for a loop,” according to the newsletter.

Western S-P-F traders in the United States reported diminishing sawmill offerings as the end of October neared. Prices correspondingly were at or slightly above the previous week’s levels as sawmills established order files into the first or second week of November. Six-inch dimension was in comparatively high demand. Persistently depleted field inventories across the board were another incentive to get deals done. Demand for low-grade commodities lagged behind that of #2&Btr.

Sneaky strong demand kept Canadian suppliers of Western S-P-F lumber busy, thanks in large part to the momentum generated by recent curtailment announcements from two major producers in Western Canada. Sawmill lists were light to start the week and only dwindled from there. Buyers tried to remain cautious and focus on LTL deals through the distribution network, but availability there was drying up also. Producers were firm on their numbers and no longer amenable to counter-offers.

“Demand for Western S-P-F studs rode a continued undercurrent of strength according to Canadian suppliers, even if it lagged behind that of dimension. Buyers remained hesitant to cover more than their immediate needs, with hand-to-mouth purchasing still the most common strategy.
Wholesalers and distributors were busier than mills again, and inventory among all suppliers was getting tighter with each passing week. Strong order files into mid-November and dwindling availability appeared to underscore the strengthening position of producers.”

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Larry Adams | Editor

Larry Adams is a Chicago-based writer and editor who writes about how things get done. A former wire service and community newspaper reporter, Larry is an award-winning writer with more than three decades of experience. In addition to writing about woodworking, he has covered science, metrology, metalworking, industrial design, quality control, imaging, Swiss and micromanufacturing . He was previously a Tabbie Award winner for his coverage of nano-based coatings technology for the automotive industry. Larry volunteers for the historic preservation group, the Kalo Foundation/Ianelli Studios, and the science-based group, Chicago Council on Science and Technology (C2ST).